Mining as a Core Supplier to the Global Clean Energy Revolution – by Paul Stothart

Paul Stothart is vice president, economic affairs of the Mining Association of Canada. He is responsible for advancing the industry’s interests regarding federal tax, trade, investment, transport and energy issues.

Few subjects are receiving as much attention in the daily media as that of our societal need to move towards a clean energy economy. This theme was fundamental to the platforms of all the Canadian federal parties in the recent election — each featuring an array of programs supporting this transition. In the United States, the platform of President-elect Obama talks extensively of hybrid vehicles, electricity from renewable sources, low carbon standards and the ultimate objective of eliminating oil imports from the Middle East and Venezuela within a decade. Republicans in Washington talk of nuclear power, carbon capture and sequestration and battery development, among other initiatives.

Beyond the political and media coverage, it is evident that few subjects offer comparable transformative potential as changes to the world’s energy infrastructure. Developed economies have been driven for two centuries by the industrial combustion of fossil fuel — indeed there has long existed a direct macro-economic correlation of living standards with per-capita energy consumption. Societies that have been able to efficiently generate and transport energy from fossil sources have become far wealthier than those that cannot. To shift away from this dependency, even in a gradual manner, requires major changes in our underlying financial, fiscal and technological practices.

The market potential for new products and technologies associated with such a shift is staggering.

Read more

Xstrata Layoffs in Sudbury: Short-term Financial Gain and Long-term Hiring Pain – by Stan Sudol

Global commodity prices have fallen off the cliff. ThyssenKrupp AG, Germany’s largest steelmaker, recently stated that not since the end of the Second World War has the demand for steel fallen so rapidly. Steel is the fundamental building block of all infrastructure and manufacturing activities.

These are extraordinary economic times, so we all knew this was coming.

Yet no one was prepared to see Xstrata Nickel chop its Sudbury workforce in half – 686 layoffs and 210 early retirements. Like most in the community, I am shocked and very, very angry. This kneejerk reaction from Zug, Switzerland has two serious repercussions that will affect the Canadian mining sector for a long time. The first is this: should Canada have allowed foreign companies to take over such a strategic resource as the Sudbury Basin with such weak controls on jobs and investment and, second, how will these severe employment cutbacks impact impending labour shortages in the mining sector?

To be fair, regardless of who owns the two nickel miners, the fundamental issue is that you cannot continue operating if it costs $6 to mine a pound of nickel and you can only sell it for $5.

Read more

Sudbury Community Furious About Xstrata Layoffs – by Bill Bradley

Northern Life, Greater Sudbury’s community newspaper, gave Republic of permission to post Bill Bradley’s article.

Many Sudbury residents are furious that Xstrata Nickel laid off 686 workers Feb. 9 given an anti-layoff agreement the Swiss company signed in 2006 when it took over Falconbridge Ltd.

“In July 2006, the Minister of Industry allowed the Swiss-based Xstrata to buy-out Canadian based Falconbridge, on the condition that Canadian jobs would be protected for three years,” said Sudbury New Democrat MP Glenn Thibeault, in a release.

“This (announcement of layoffs) is cold comfort to the 700 Canadians who have lost these so-called protected jobs,” said Nickel Belt New Democrat MP Claude Gravelle.

Both federal politicians said there is still time for the federal government to say no to the job cuts.

In an Xstrata release dated July 25, 2006, it is stated, “to demonstrate net benefit to Canada in order to obtain the approval under the Investment Canada Act, Xstrata has provided to the minister several important commitments in respect of Falconbridges’s operations and employees in Canada.”

Read more

Sudbury’s Mood Fiery as Furnaces (1977) – by Elmer Sopha (1925-1982)

This article was written by former Sudbury lawyer and MPP in October, 1977, in response to the then recent massive layoffs of 2,800 local workers by Inco. Ironically, some of the issues in his column will resonate with the recently laid off Xstrata workers in February 2009. The more things change, the more they stay the same!Stan Sudol

Once upon a time Local 6500 of the United Steelworkers of America was the vehicle for economic security of 18,000 hourly rated workers in Sudbury. Those were the salad days of high employment which marked feverish exploitation of the magnificent geological structure disposed, it is said, on the Sudbury basin by a vast errant meteor a couple of billion years ago.

It hosts 14 metals and the one most talked about is nickel and that is probably why the complex came to be known as The International Nickel Company of Canada Limited. But it is now an age of efficiency, the acronym is its phylactery, and the name perforce has been shortened to Inco Ltd.

Dave Patterson, young in years and not yet hardened against the realities of life, is president of the union, which by slow and steady attrition numbers only 11,000 these days.

As one listens to him speak in public one senses that his idealism is intact. He conveys genuinely and humanely the reflection of sorrow and uncertainty which beset 2,800 workers and their families who have received an impersonal slip attached to their time cards which told them tersely that their jobs no longer existed.

Read more

Sudbury’s Elmer Sopha – 1925-1982 – A Historical Profile

The following profile was originally published in the South Side Story – a Sudbury weekly paper on January 2005. He was called the “northern gadfly” and was one of Sudbury’s most flamboyant and successful criminal lawyers. Elmer was born in Cobalt and began his law practice in Sudbury after completing his studies and serving in …

Read more

Xstrata Nickel Announces Restructuring of Sudbury Operations (Company Press Release)

Toronto, 9 February 2009

Xstrata Nickel today announces plans to restructure its Sudbury operations in response to ongoing challenging market conditions.  The restructuring follows the announcement in November 2008 of the accelerated closure of the end-of-life Craig and Thayer-Lindsley operations at Sudbury, both of which will cease operations with immediate effect.

As a result of the restructuring, the Fraser Mine Complex will be placed on care and maintenance and associated support and administrative functions will be reorganized. The Strathcona Mill, with annual capacity of 2.7 million tonnes of ore, will be reduced to two work shifts from four as a result of reduced feed. In addition, the Fraser Morgan development project will be deferred. This project will be evaluated on an ongoing basis and may be re-initiated when economic conditions allow.

Today’s announcement does not impact the world-class Nickel Rim South project in the Sudbury basin.  The project remains on schedule to ramp up to 60% of its ultimate 1.25 million tonne per annum production capacity in 2009, equivalent to approximately 7,400 tonnes of nickel.  Nickel Rim South will become a low-cost, cornerstone operation in Sudbury, generating annual production of approximately 18,000 tonnes of recoverable nickel by early 2010. 

Read more

Xstrata Says Demand Collapsing, 686 Jobs Lost – by Bill Bradley

Northern Life, Greater Sudbury’s community newspaper, gave Republic of permission to post Bill Bradley’s article.

The global economic meltdown is now biting Greater Sudbury. Gone for good are 686 full-time jobs at Xstrata Nickel, after the company announced a major restructuring of its Sudbury operations.

“Demand for our product has collapsed,” said Marc Boissonneault, vice-president Xstrata Nickel, Sudbury on CBC Radio One, Monday morning.
“We can’t carry on business as usual.”

As a result, the following will occur:
– 686 permanent employee positions will be made redundant, affecting both union (600) and salaried (86) employees;
– three-day shutdown will take place immediately to implement restructuring and talk to employees;
– 300 employees will be moved to the higher-value Nickel Rim project, displacing some contractors;
– Fraser Mine will be placed on care and maintenance for now;
– accelerated closure of Craig and Thayer-Lindsley operations;
– Strathcona Mill will be reduced from four shifts to two;
– Fraser Morgan development project will be deferred to be evaluated and possibly re-initiated.

Read more

OMA Chairman George Flumerfelt Headlines Canadian Mining Magazine

This article was provided by the Ontario Mining Association (OMA), an organization that was established in 1920 to represent the mining industry of the province.

Ontario Mining Association Chairman George Flumerfelt is featured in the January 2009 issue of the Canadian Mining Journal.  “Keeping Pace With Reality” is the headline on his article in the magazine.  Mr. Flumerfelt, who is President of JS Redpath, took over as Chairman of the OMA in June 2008.

In the article, he catalogues some of the initiatives being carried out by the OMA to help its members get through the current rough patch and lay the groundwork for the foundations of future growth and development.  “There is no doubt the current downturn in prices has come upon us more suddenly that those of years past,” he said “Also, when coupled with the world credit crunch and all the talk of global recession, government bailouts of banks and formerly stable household name companies, the situation seems to be more serious this time.”

“Hopefully, with all the stimuli being applied by countries around the globe, the mining industry will start to recover before too long,” Mr. Flumerfelt added.  “One thing we do know for sure is that recovery will come as companies and individuals adjust to the current market realities.”  And on an optimistic note, he said “We need to remember that demand for mineral commodities will return and inevitably better pricing will  follow.  It is hard to believe that 2009 is going to be a great year but there is some hope for price recovery in 2010.”

Read more

Diamond Industry Grinds to a Halt – by Marilyn Scales

Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators. The global diamond industry is suffering the same economic downturn as the rest of the world. Consumers who may be out of work or watching their investments shrink are in no …

Read more

Mining, Sustainable Development and First Nations, Our New Frontier – by Pierre Gratton, President & CEO, Mining Association of British Columbia

Pierre Gratton, President & CEO, Mining Association of British ColumbiaThis speech was given to the Canadian Institute of Mining, Metallurgy and Petroleum (CIM) – North Central Branch, Prince George, British Columbia on June 26, 2008 by Pierre Gratton, President and CEO of the Mining Association of British Columbia.

Thank you for that kind introduction. It is a pleasure to be here to give what is, in fact, my maiden speech as President and CEO of The Mining Association of British Columbia. Actually, it’s a pre-maiden speech, because I don’t officially take the helm until next Monday.

I am also pleased that Prince George has reconstituted its CIM branch after a few years of dormancy – congratulations on this initiative. This is a trend we are seeing across the country and it reflects the strong period of growth we are in. But your resurgence is not just a good indicator of our good times. CIM and its many branches have a unique role to play across our country in getting the message out about our industry. You help to demonstrate to society that ours is a safe, dynamic, progressive sector committed to excellence, the sharing of best practices, technology and innovation.

I urge you to reach out and grow this branch and to look to play an active role in this community. One clear example of this is the leadership that our sector demonstrates in health and safety, with mining now the safest heavy industry in British Columbia – a tremendous accomplishment built on strong and respectful relationships between mine management, labour and government that we can all be very proud of.

Read more

Mine Games – The Current State of Mining in British Columbia

BCBusiness, is British Columbia’s foremost business authority and the most widely read business publication in the province. This article was originally published January 01, 2009.

BCBusiness interviewed the following three key players about the current state of mining in British Columbia:

Terry Lyons-Chair Northgate Mineral Corp.

“In Canada there is no urgency to move projects to a “yes” or a “no.” And I will tell you over and over again, the industry doesn’t mind “no.” Say “no” and let us move on with our lives and our shareholders’ capital. But to waste five, six, seven, eight years because the bureaucrats in the government cannot make a decision or don’t want to make a decision doesn’t do anybody any good.”

Ken Boggio-PricewaterhousCooper LLP

“You look at China, for example: almost 7,000 privately held coal mines and reports that 250 or more people die each week in these coal mines. Do you want your steel being made from coal mined in China or would you prefer to have it come from the Fording properties in southeastern B.C.?”

Byng Giraud-Vice-President of Policy and Communications Mining Association of British Columbia

“We estimate between 25 and 30 projects in this province that could become mines are somewhere in the environmental testing or permitting process. And when I talk about political will or societal will to open a few extra mines in this province, that could mean the difference between recession and not. It’s that significant. We’re talking billions of dollars of capital investment and construction. Thousands of jobs. Building communities. The upside is huge.”

Mine Games

Sitting in a room with a group of high-profile insiders in the B.C. mining industry, the one thing that stands out is a sense of rejection, of an industry that built cities and towns across the province asking, “Do you want us here or not?”

Vancouver is a centre for mining in the world, with hundreds of companies engaged in raising money and spending it on far-flung geological studies, exploration missions, mine developments and extraction efforts. But when it comes to digging mines in B.C. itself, the picture is bleak. Mines across the province are reaching retirement age, and no promising young mines have come on scene to take their place since the mid-’90s.

Not that the province’s many miners aren’t trying. But the hurdles standing in the way of digging a new hole in B.C. are enormous, be they economic, social, environmental, logistic or simply bureaucratic. It’s enough to make miners wonder if they’re really welcome here at all.

Read more

Canadian Federal Budget Extends Exploration Tax Credit – by Marilyn Scales

Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators. Canadians listened hopefully as federal Minister of Finance Jim Flaherty stood in his new, steel-toed shoes to deliver the Conservative’s budget on Jan. 27. It contained a wide range of spending …

Read more

Ontario Mining Sector Safety Performance Improves in 2008

This article was provided by the Ontario Mining Association (OMA), an organization that was established in 1920 to represent the mining industry of the province.

Ontario´s mining industry improved its safety performance in 2008 from 2007, according to provisional numbers, which have been released by the Mines and Aggregates Safety and Health Association (MASHA).  This keeps mining on track as one of the safest industries in the province.  Mining´s safety record outpaces sectors such as manufacturing, services, forestry, construction, health care, municipal workers, agriculture and transportation.

The mining industry´s lost time injury rate for 2008 was 0.6 per 200,000 hours worked, which is a 25% improvement compared with the lost time injury rate of 0.8 per 200,000 for 2007.  While this moves the sector closer to zero, there was some slippage in another safety benchmark.  The total medical injury frequency rose to 7.5 per 200,000 hours worked in 2008, compared with 7.1 per 200,0000 hours worked in 2007 — a 6% increase.   However, the severity of those incidents showed a marked improvement of 60%.  In 2008, the severity of injuries was reduced to 54 days from 136 days in 2007. 

Ontario mining´s sector has been steadily becoming safer for decades.  The 2008 lost time injury rate of 0.6 per 200,000 hours is an 87% improvement compared with the lost time injury rate of 4.7 per 200,000 hours in 1985.  Credit for these stronger safety performances reside on the shoulders of every individual who works in the industry.  The statistics are moving in the right direction because of the personal diligence on the safety front and concern for oneself and his and her colleagues.  There are a number of initiatives and institutions supporting these gains.

Read more

Rating Mining for Ethical Performance – by Marilyn Scales

Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators. Last week a Geneva-based group called Covalence SA released its ethical rankings of multinational corporations. The methodology used is convoluted, and the results could be questioned. Points were added and subtracted …

Read more

A Ten Point Northern Ontario Stimulus Package – by Dr. David Robinson

Dr. David Robinson - Laurentian University Economist

 Dr. David Robinson is an economist at Laurentian University in Sudbury, Canada. His column was originally published in Northern Ontario Business.

Harper has adopted the coalition budget. He will spend up to $30 billion to moderate the recession that he recently discovered. That is $895.66 for each man, woman and child in Canada. Northern Ontario has 678,900 of Canada’s 33,495,032 citizens. Our share of the stimulus package is $563 million. We should make sure it is well spent.

Economic stimulus is not about bailing out companies by giving them money. It is about helping businesses survive by stimulating demand. That’s why there is so much emphasis on  infrastructure projects. Infrastructure usually means roads, and other public works. Infrastructure projects put the construction industry to work. The construction industry hires unemployed workers. Since supplies are generally bought locally, infrastructure projects boost the local economy.

Tax cuts, on the other hand, are a very poor way to help Northern Ontario. If you give every Northerner $895, a lot of it would be spent on consumer goods. Canada imports consumer goods, so a tax cut goes almost directly to foreign producers. The Harper-Flaherty GST cut was terrific for our trading partners.

Read more